We have seen a situation similar to the one we are experiencing today, once again during the year. The price fell steadily and finally made a fresh low at $28,000. Constantly updated resistances had brought the price down gradually. In the past weeks, we were talking about how important the 58,000, 55,000 and 53,000 regions are.
Today, we are discussing whether the price will exceed $50,000. But the price seems to have set its sights on the $40,000 levels. Will we relive the same bitter experience?
Trapped in the correction phase, Bitcoin lost 30% of its value. Moreover, the bears are aiming to extend this retracement even further after gaining the 200-day EMA. For now, a bullish breakout could occur as seen from the price pattern and the RSI divergence. There is still a chance of recovery for Bitcoin. But how long will this last?
Recently, Bitcoin price broke the 0.5 Fibonacci retracement level and the crucial support of the 200-day EMA. The price then retraced, trying to identify suitable resistance before a significant drop. However, even after multiple retests, the bears were unable to further reduce the price as the price still managed to stay above the $45,000 psychological level.
Bitcoin Technical Analysis
The technical chart shows the price fluctuating in a falling parallel channel pattern. The critical EMA levels (20, 50, 100 and 200) are bearish for BTC. Besides, the pair is continuing its downtrend between the 20 and 200 EMA. A strong bullish divergence has formed on the Relative Strength Index (44) chart, which could indicate that buyers are starting to return to the game.
Since the last two weeks, the BTC price has been floating in a falling parallel channel pattern. Today, however, the price has rallied from this pattern, presenting a significant opportunity for the bulls. In any case, cautious traders can expect the price to stay above the 200-day EMA line.
If the upward movement continues, the $49,450 and $52,200 resistances will be decisive for the price direction. If the wind turns upside down again, the $47,460 and $44,700 supports should be watched closely.